National Blog

Glenn Jacobs Slams the National Internet Tax Mandate

"Don’t be fooled by its title," writes Glenn Jacobs, "the Marketplace Fairness Act is anything but fair."

The Marketplace Fairness Act is being pushed by three US senators, Dick Durbin, an Illinois Democrat, Mike Enzi, a Wyoming Republican, and Lamar Alexander, a Tennessee Republican. What is the injustice that the Marketplace Fairness Act addresses? Under current US law, states are prohibited from forcing Internet retailers who have no physical presence within their borders to collect sales tax on Internet transactions. This policy gives Internet retailers an advantage over traditional brick-and-mortar retailers who must tack, in some cases, up to 10% onto transactions due to sales tax.

While it is obvious that on-line retailers do have a tax advantage in this particular area, politicians sure have a perverted sense of "fairness." After all, taxes are a creation of the government. Not all states impose sales taxes and sales tax rates vary among the states and sometimes even on different items within a particular state. So this has nothing to do with the market, but everything to do with government interventions in the market. If politicians were truly interested in fairness, they would eliminate coercive taxation from the marketplace altogether. Granted, US Senators have no power over state sales taxes (yet), but the Marketplace Fairness Act would make these taxes that much more inescapable. For Durbin, Enzi, and Alexander, the definition of fairness means that the iron fist of the government should crush all of us equally.